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Larry Bird steps down, Donnie Walsh returns

Ex-Knicks president [Only registered and activated users can see links. ], ousted by Garden chairman Jim Dolan last June after he was offered a 40% pay cut, is returning to the Indiana Pacers.

Walsh, the long-time Indiana CEO before he came to New York to rebuild the Knicks, will be leading the Pacers in their efforts to land free agents starting when the period opens Sunday, league sources said Monday. The team's No. 1 priority is to re-sign point guard George Hill, a restricted free agent, and sources said Walsh will be spearheading the team's efforts to keep Hill.

Walsh, 71, has a close relationship with Pacers owner Herb Simon and has been attending the team's pre-draft workouts in recent weeks. He was ousted near the end of his third season in New York after Dolan refused to give him full autonomy and offered him a substantial paycut. Although he was a consultant for the Knicks this past season, he had no input with the team from his Indianapolis home.

Dolan's move to trade for Carmelo Anthony in 2011 was a factor in Walsh deciding he had enough of the way Dolan and the Garden conduct their business, as Walsh always had to put up with Isiah Thomas' presence as Dolan's chief, unpaid consultant. Officially, the two sides explained Walsh's departure by saying he refused to agree to a multi-year deal. The Knicks have never replaced Walsh, who undertook the massive rebuilding effort that landed the team Amar'e Stoudemire in July, 2010, after it lost out to Miami in the LeBron James sweepstakes.

Walsh's return to the team he led for 24 seasons will not necessarily mark the end of Larry Bird's tenure as team president. Bird said he wanted to return after the Pacers' season ended with a second-round loss to the Miami Heat. One indication that the NBA incon likely is staying is that Kevin Pritchard is expected to be promoted from director of player personnel to general manager. Formerly the GM in Portland, Pritchard was brought to the organization by Bird. GM David Morway has not been around the team in recent weeks and the team has not explained his absence.